The total value of houses in Victoria has seen a significant increase, reaching $2.55 trillion, confirming the claims of experts that the housing market is improving. This increase equates to an increase of $60 billion, bringing the housing market in Victoria closer to the record set in March 2022. Nerida Conisbee, chief economist at Ray White, suggests that this strong also shows that the correction of the housing market driven by the increase in interest rates has ended.
Data from the Australian Bureau of Statistics revealed that the total value of housing in Victoria rose from $2.49 billion in the first quarter of 2023 to $2.55 billion in June. Conisbee believes that the increase in interest rates has increased, which has led to an increase in buyer confidence and the subsequent increase in prices. He expects the number to continue to rise in September.
A number of factors have contributed to rising house prices in Victoria. Migration is one such factor, along with a lack of new homes, leading buyers to turn to the established housing market. The $60 billion increase in data, which was seen as the opposite of a trend, is a new sign that the market is turning around.
Although interest rates have risen rapidly, the drop in house prices has not been as significant as expected. Conisbee explained that this was due to the completion of some houses during that period, although construction challenges limited the number of those completed. Quentin Kilian, CEO of the Real Estate Institute of Victoria (REIV), described the recent rally as more of a stabilization than a peak, projecting a continued upward trend for years to come. , albeit at a slower pace.
Kilian attributed the rise in house values ​​to several factors, including the return of expatriates to Australia since the end of the COVID-19 pandemic. However, he stressed that the main driver of the growth in house values ​​is the chronic shortage of housing supply. It claims that Australia has not sufficiently saturated the market since the end of the pandemic, resulting in a widespread housing shortage. Kilian believes that if supply is increased, the total value of houses will grow and stabilize naturally, avoiding sharp peaks and troughs due to lack of supply.
